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An ongoing industry-wide slump in the CD business continues to drag on Warner Music Group’s performance.

The major label posted a 58-percent drop in fourth-quarter net income in the face of weak sales outside the US, costs associated with a restructuring of its workforce, and slow growth in digital music purchases.

However a better-than-expected 2 percent gain in revenue to $869 million, driven largely by cost management, cheered investors yesterday, who pushed the struggling stock up 8 percent to a close of $7.73.

Warner CEO Edgar Bronfman Jr. said in a call with analysts that both the company and industry remain in transition, with digital remaining a sticking point.

“Digital growth, and particularly mobile, have been on a slower trajectory than initial expectations,” he said.

That is putting increasing pressure on the company to find alternative sources of revenue.

Bronfman said Warner continues to push into everything from artist management businesses to joint venture deals with artists in which they participate in all of their artists’ revenue streams – touring, merchandizing, fan clubs and endorsements – not just albums.

Meanwhile, investments in artist management operations and multi-rights companies in Asia are accounting for as much as 15 percent of total revenues in certain countries.

Bronfman sees promise in such results, but declined to extrapolate the potential for similar performance in the US, particularly from investments like its $110 million stake in Front Line Management, home to the Eagles and Christina Aguilera.

Warner’s expansion into new business comes as it is facing new competition on its home turf from touring and concert promotion giant Live Nation, which recently poached Madonna in a deal worth more than $100 million.

“We see our value to the artist as an enduring one despite the record industry’s changing economics and the interests of new competitors,” Bronfman said. brian.garrity@nypost.com